Top 10 Markets Powered by Serious Job-Creation Mojo

The best spring housing market we have seen since 2006 is underway, with above-average price appreciation. But unlike the 2003–2006 housing bubble, these gains are real and sustainable. How real? Let’s take a look at the 10 best large markets where job growth is powering home price increases.

The main factor driving home price acceleration across the nation is strengthening demand. Nearly 3 million jobs have been created in the past 12 months, and (not coincidentally) consumer confidence is higher.

These 10 markets have major job-creation mojo. They stand out among the 100 largest housing markets in the country, because they have the highest level of job creation in the past three years, as well as above-average price appreciation. Furthermore, they are also forecast to see more of such growth in the year ahead.

Here’s a closer look at them, in alphabetical order, with their key distinguishing statistics. Figures for multiyear growth are given as compound annual growth rates.

Atlanta–Sandy Springs–Roswell, GA

Employment growth, 2011–2014: 1.7%

Median home price growth, 2011–2014: 20.3%

Median list price in May: $238,000

Median list price growth, May 2015 vs. May 2014: $13.3%

Market size rank: 9

Atlanta took the most time to recover from the housing downturn, but it has seen an eye-popping 20.3% compound annual growth rate in median home price over the past three years as the market bounced back from the bottom in 2011. Now the diversified local economy is seeing strong gains driven by professional and business services, and construction activity should start to provide even more economic growth going forward. The market’s affordability is a draw for new households and employers alike.

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Austin–Round Rock, TX

Employment growth, 2011–2014: 3.7%

Median home price growth, 2011–2014: 8.5%

Median list price in May: $374,000

Median list price growth, May 2015 vs. May 2014: 20.7%

Market size rank: 34

Austin has been no stranger to top market lists throughout the past decade, as Texas has been one of the few reliable states for economic growth. Austin’s biggest employment sector is government, but professional and business services has been powering the more recent growth. Austin also has the highest household formation rate as a result of the employment growth.

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Charlotte–Concord–Gastonia, NC–SC

Employment growth, 2011–2014: 2.7%

Median home price growth, 2011–2014: 8.4%

Median list price in May: $232,000

Median list price growth, May 2015 vs. May 2014: 14.9%

Market size rank: 24

Charlotte is one of the most affordable markets in the nation, even with its strong price appreciation. The median list price was up 15% over last year in May, while the median age of inventory dropped six days to 48. The diversified local economy should be seeing even stronger growth in employment in the year ahead.

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Dallas–Fort Worth–Arlington, TX

Employment growth, 2011–2014: 2.9%

Median home price growth, 2011–2014: 8.2%

Median list price in May: $278,000

Median list price growth, May 2015 vs. May 2014: 19.3%

Market size rank: 4

Dallas–Fort Worth is the largest market with major mojo. Dallas has been one of the healthiest housing markets in the country over the past decade and did not experience as severe declines in home values as other markets did. The job market is relatively diversified, and growth in jobs is expected at an even higher pace in the year ahead.

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Denver–Aurora–Lakewood, CO

Employment growth, 2011–2014: 2.9%

Median home price growth, 2011–2014: 10.8%

Median list price in May: $445,000

Median list price growth, May 2015 vs. May 2014: 11.8%

Market size rank: 20

Denver reigns as the hottest housing market in the country so far this spring. While the market did see growth from the energy sector in recent years, it remains relatively diversified with professional and business services as the primary driver of job growth. Jobs and prices should continue to grow in the next year at better than the national rate.

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Grand Rapids–Wyoming, MI

Employment growth, 2011–2014: 4%

Median home price growth, 2011–2014: 9.8%

Median list price in May: $184,000

Median list price growth, May 2015 vs. May 2014: 14.3%

Market size rank: 53

Grand Rapids is the smallest market on our mojo list. Its largest employment sector is educational and health services, but professional and business services has been powering the growth rate of 4% over the past three years. In addition, its strong affordability is a draw.

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Orlando–Kissimmee–Sanford, FL

Employment growth, 2011–2014: 3.6%

Median home price growth, 2011–2014: 12.5%

Median list price in May: $234,000

Median list price growth, May 2015 vs. May 2014: 13%

Market size rank: 25

Orlando has seen substantial economic recovery in recent years, but it remains relatively affordable. The local job market is dependent on leisure and hospitality. Affordability and strong growth ahead should drive substantial population and household growth in the year ahead.

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Salt Lake City, UT

Employment growth, 2011–2014: 2.8%

Median home price growth, 2011–2014: 10.3%

Median list price in May: $298,000

Median list price growth, May 2015 vs. May 2014: 14.2%

Market size rank: 52

Salt Lake City is the second smallest market on our list, ranked just ahead of Grand Rapids at No. 53. Despite its size, the local job market is very diversified, and nearly 3% annual growth in jobs over the past three years has powered over 10% annual gains in home prices. This year’s market is showing no signs of slowing down those gains.

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San Francisco–Oakland–Hayward, CA

Employment growth, 2011–2014: 3.2%

Median home price growth, 2011–2014: 16.8%

Median list price in May: $749,000

Median list price growth, May 2015 vs. May 2014: 8.7%

Market size rank: 11

San Francisco is the second-hottest housing market this spring. The type of employment that the Bay Area creates has driven a substantial increase in high-income households: Those with an annual income of $250,000 or more have almost tripled since 2000. This year’s employment growth should end up very similar to the recent three-year trend.

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San Jose–Sunnyvale–Santa Clara, CA

Employment growth, 2011–2014: 4.1%

Median home price growth, 2011–2014: 15.6%

Median list price in May: $898,000

Median list price growth, May 2015 vs. May 2014: 27.9%

Market size rank: 36

San Jose represents the heart of Silicon Valley, and ranks as the third-hottest housing market this spring. The market is highly concentrated in the tech sector, but that sector’s growth has had a substantial impact in increasing the number of high-income households. In 2000, 4% of the households in the market had an annual income of $250,000 or more. Today it’s 12%.

These 10 markets show just how important job growth is to strong demand for housing. And with housing and new construction producing significant gains, a virtuous economic cycle will be reinforced.